One In Three Tech Workers Is Underpaid

Many are earning at least 10% less than they could command if they looked for new job today

By: Lauren Weber

The Wall Street Journal


Sure, you know what you’re paid. But what are you worth?

In high-demand labor markets such as technology, it is tough for workers to keep up with changing salary norms, so they may be leaving money on the table, a new study says.

More than one-third of tech professionals are earning at least 10% less than they could command if they looked for a new job today, according to salary-data firm Paysa. The firm compared the resumes and total compensation, including bonuses and equity where applicable, of more than five million workers with real-time information on what companies are paying employees with similar credentials and characteristics.

The lost income can translate to thousands of dollars at a time when median annual pay for software developers, for instance, is $100,690, according to the Labor Department.

Paysa analyzed thousands of variables, such as individual work histories, hiring trends and turnover rates at companies to determine whether workers may be underpaid or overdue for a promotion. It found that nearly 80% of technologists—software engineers, developers, systems administrators and others—have one or more characteristics that indicate they may be ready to move to a new job.

The mismatch on salaries probably doesn’t stem from malicious intent or a desire by employers to “get a deal,” said Paysa CEO Chris Bolte. More likely, many workers don’t know their own value, especially if they haven’t looked for a job in a while, and employers often set compensation using outdated or overly broad benchmarking data.

Compensation is one of the most opaque aspects of employment. Although a few small companies have experimented with salary transparency, most employers closely guard their pay practices, hoping to retain the upper hand in salary negotiations and minimize resentment among workers. But employees are seeking, and in some cases seizing, more information about their compensation. Greater transparency can also keep in check pay discrimination based on race or gender.

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